Many retailers consider 2017 as the best sales season. Holiday spending during the previous year was at its peak since 2011. People prefer purchasing gifts online now. Going to the store is old school.
According to eMarketer, ecommerce retail sales in 2018 will be strong, but not quite as strong as in 2017. They say that ecommerce sales are likely to increase 15.3% in 2018. That sounds great and it is; but, in 2017, the holiday spending statistics grew by 17.8%. Whereas according to Visa, ecommerce retail sales will experience a growth of 15%-17% in 2018.
Despite what holiday season 2018 has to offer, are you ready to grab all that holiday spending?
The Gist of Holiday Sales Season 2018 [Infographics]
Let’s Delve Deeper into Holiday Spending Insights 2018
Commercialization of Christmas raised a lot of complaints, but people bought gifts for their friends and family during that time. And it maintains a strong presence as ever. It has become a cultural norm in the United States. Day after day, more and more customers are adopting online shopping. Why? Two reasons. Easier access to product reviews and convenience of delivery.
According to eMarketer, all retail sales whether online or in-store will grow by 3.8% in 2018 to the tune of $691.9 billion. These are good numbers but not as good as 2017 when holiday spending grew up to 5.5%.
eMarketer’s Retail Analyst Yory Wurmser says, “Amazon is an authoritative driver of ecommerce. It accounted for over a quarter of online holiday spending in 2017. It should be even higher in 2018, as Amazon’s revenue growth outperforms ecommerce growth as a whole.”
Holiday season 2018 will provide remarkable opportunities for ecommerce growth. Online retailers can scale themselves by understanding customer preferences and purchasing cycles. Your best-selling products throughout 2017 will be once again the winning products this holiday season.
1. Holiday Spending Key Findings 2018
There are a few aspects that online marketers should keep in focus. Don’t put all that effort to waste. Work smart. With the help of the following tips and tricks, you will be able to scale your business this holiday season 2018.
i) Holiday Spending Begins from October
Retail giants like WalMart, Best Buy and others often promote their deals before Thanksgiving. It creates a cascading effect. Online shoppers do not wait for the official sales season. They search for all the deals they can find before the season begins. You can increase your profits sharply with an extended period of promotion.
ii) In-Store Footfall Is Reducing
Regardless of the holiday sales season, the in-store footfall continues to lessen. According to a study, foot traffic in US retail stores fell 7.5% in November and December 2017. Why? Because purchasing from mobile devices has become a trend. It is convenient for many. It is driving the traditional purchasing away from physical stores.
iii) Cell Phones Are the Go-To Purchase Channel
More than 40% of the sales came from mobile phones during 2017. December 23, 2017, bagged in the largest share of mobile commerce in the history of USA. Mainly 48% of all transactions came from smartphones. Based on the current trends for holiday season 2018, you should expect a higher turnover this year. Retailers who offer a shopping app tend to generate more than 50% of online transactions. In-app sales dominate. Do ensure your website and app are fully equipped and super responsive. Focus on speed, user experience, and the ease of checking out. Also, mobile shopping dominates during night time and weekends of the holiday season.
Cell phones are a major reason behind the ecommerce growth. According to ComScore Inc, US retail sales from cell phones increased more than 40% in the final quarter of 2017. eMarketer predicts a growth of 32.7% in US retail sales from cell phones in 2018. Nonetheless, Desktop PCs are still the most preferred medium to place online orders.
iv) Online Shoppers Have a Stronger Purchasing Power
People will buy many gifts online during the holiday season 2018. This is great news for foreign dropshippers. eMarketer says the purchasing power of American customers is at its peak since 2000. Lower unemployment and better wages will have a positive impact on the holiday spending statistics this season.
According to Statista, 54% of customers prefer shopping in-stores. Why? Because they can find one-of-a-kind gifts. This gives local retailers a brilliant advantage over ecommerce retailers. Online retailers should benefit from the increased purchasing power of the online shoppers.
v) Cyber Week I & II Bag-In Major Chunk from Holiday Spending
No one argues on the impact of Black Friday and Cyber Monday during the holiday season. The Cyber Week allows online retailers to scale their web shops.
However, 2017 revealed an unexpected opportunity in the US and UK. The week between Christmas and New Year has now become “Cyber Week II”. UK sales grew 28% between December 26 and December 30, 2017.
The day of Christmas marks the beginning of the Cyber Week II. During this period online shoppers return to the market to take advantage of fresh deals. Online shoppers look forward to the year-end deals, as they are inspired to spend on themselves before wrapping up the a stressful year.
vi) Email Converts Best for Holiday Online Shopping
Emails still rule during the holiday sales season. Klayvio says, emails generate 27% of holiday spending during BFCM. Roughly 500,000 online merchants assured that emails brought them higher sales. The numbers speak for themselves.
- Email Conversions: 4.29%
- Organic Search: 3.04%
- Direct Sales: 2.93%
- Social Media: 1.81%
However, online retailers also confirmed that 64% of customers who convert during the BFCM season have a lower lifetime value (LTV). To overcome seasonal purchases, you can generate loyalty by running post-holiday online shopping campaigns.
2. Criteo Shopper Graph
It is essential to understand what your customers want from you. Retailers should put three types of customer data together. Identity, Interest, and Measurement. The Criteo Shopper Graph helps online retailers to maintain control of buyer personas. With in-depth customer insights, online retailers can drive better results for themselves. They can create customer loyalty by delivering more personalized customer experiences.
3. Global Ecommerce Performance
Statista predicts a whopping 246.15% increase in the worldwide ecommerce. From $1.3 trillion in 2014 to $4.5 trillion in 2021. During the past few years, ecommerce holiday spending statistics has increased sharply. The ecommerce center of the world is not the West anymore. Business.com lists out the 10 largest ecommerce markets in the world. They are as follows:
- China: $672 billion
- United States: $340 billion
- United Kingdom: $99 billion
- Japan: $79 billion
- Germany: $73 billion
- France: $43 billion
- South Korea: $37 billion
- Canada: $30 billion
- Russia: $20 billion
- Brazil: $19 billion
4. Finding Your Winning Products
The retail sales growth of USA was broad based in November and December 2017. Some of the highest profits came from home improvement products. The Department of Commerce USA also found that building materials and garden equipment surged by 8.1%. Meanwhile, furniture and home furnishing products grew 7.5%. Furthermore, sales from electronic goods and appliances grew by 6.7% in 2017. But what makes any product go viral?
- Emotional Impact: Products that provoke emotions of customers generally create a connection with them. For instance, after a stressful day at work, people want to have something that brightens their day. If your product is able to do that, it is likely to go viral.
- Practical Value: Products that are useful, help solve customer problems or allow them to become more productive are more likely to boom. Practical value of any product can beat the book value of many successful products. It can make a product go viral. Competition also becomes healthier based on the practical value of the available products. They add aesthetics to boost sales and offer customers what THEY want. This allows to build the viral factor of a trending product.
- Social Currency: Viral products allow customers to establish their social image. They want to be someone who is “with the time”. Remaining ahead of the social curve allows the product to become a must-have item. This attribute greatly helps any product to go viral.
There are three different types of products that go viral. Each category determines how long will a product survive. This is an important factor for ecommerce retailers. Understand the product’s longevity in the market before building a web shop. The three types of products are as follows:
- Fads: Fads tend to sell bright and fast. They go viral quickly; however, they also stop trending immediately. The life of Fads is up to one or two years max.
- Trends: These products set the trend at a slow pace but they stick around for a while. Unfortunately, they do not last the test of times. These products last five years at the maximum.
- Growing Markets: These products begin from scratch, but they grow into a stable market. Such products come in like a trend. But more importantly, they never go out of style. Customer demand continues to build with the passage of time. Such products can last for decades.
In a Nutshell
Try a different approach this holiday season. Think outside the traditional holiday box. Offer wow deals from as early as October. Don’t forget to optimize your ecommerce store for the mobile users. Also, pay attention to the post-holiday opportunities.
Use as much data as possible to create the best possible customer experience. Find your winning products and stick to them. The biggest sales season of the year is here. Work smart and scale your ecommerce through the roof.
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